CBO: Actually, ObamaCare is kinda’ like a tax, and it’s going to result in 2 million fewer workers by 2017

posted at 12:41 pm on February 4, 2014 by Erika Johnsen

The “Affordable” Care Act creates all kinds of adverse incentives for both employers to drop the number of hours they offer and for employees to reduce the numbers of hours they work, and the Congressional Budget Office has reexamined their erstwhile conclusions about the president’s crowning legislative achievement with an update to their original estimate of just how much of an impact those disincentives are going to have on our economy.

Now, this may come as a shock, but… it turns out that ObamaCare could actually end up eliminating the equivalent of almost three times as many jobs as the CBO first expected. You know, unexpectedly. Whoever could’ve called that one? Via the WSJ:

The Affordable Care Act is projected to reduce the number of full-time workers by roughly 2.3 million people through 2021 and insure 2 million fewer people this year than previously estimated, the Congressional Budget Office said Tuesday.

The CBO had previously estimated the labor force impact would be around 800,000 people in that time frame. …

The rolling impact of the law will lead to 2 million fewer workers in 2017, 2.3 million in 2021 and 2.5 million through 2024, the CBO forecast. This represents a 1.5% to 2.0% reduction in the numbers of hours worked. …

CBO attributed the law’s projected labor force impact to several factors. This included an impact on labor supply from an employer penalty in the law and “an effect from encouraging part-year workers to delay returning to work in order to retain their insurance subsidies,” among other things.

In a nutshell, as the CBO states, the “exchange subsidies effectively constitute a tax on labor supply for a broad range of workers;” i.e., as workers transition from part-time to full-time, many will actually lose income because of the insurance subsidies for which they will lose their eligibility. …”Absolutely no tax increases on the lower- and middle-class,” for the win!

An almost two percent reduction to the numbers of hours worked purely because of the law’s effects is kind of a big deal, and you can bet that this is not going to be welcome news to the handful of panicking Senate Democrats trying to stave off awkward questions about their “yea” votes for ObamaCare by focusing on their economically populist messaging strategy. Newly-bolstered-with-nonpartisan-statistics Republican rejoinder to their minimum-wage schtick: Hey, if you really wanted help out a lot of lower-income wage earners, why did you vote for ObamaCare, again?

And here’s yet another delightful tidbit from the CBO’s analysis: I’m seeing headlines pertaining to the report that run along the lines of, “deficit continues to drop” and “deficit shrinks to lowest level under Obama.” …I mean, I suppose the fact that we’re only at half-trillion dollar deficits now rather than a full-trillion certainly sounds lovely enough (whoop-de-doo), except that the drop is a pretty temporary blip brought on by tax increases and the 2011 Budget Control Act, and that after 2015, the budget deficit is on pace to pick right back up and eventually reach at least $1 trillion again by 2022.

For the current fiscal year, spending will grow by 2.6 percent, while tax revenues will grow more than three times faster, by about 9 percent, the budget office said in its annual budget and economic forecast. …

But the CBO also warned that after 2015 deficits will start rising again because federal spending will grow more quickly than the economy will.

Beyond 2017, the budget office is forecasting that economic growth will be less than the average growth over the past several decades, in part due to an aging population and slow-growing labor force.

By 2024, the end of its ten-year forecasting period, a surge of Medicare, Medicaid and Social Security spending will push federal debt held by the public to nearly 80 percent of GDP — “eventually increasing the risk of a fiscal crisis” in which investors would demand higher interest payments to buy federal debt, the CBO report said.

Slapping more taxes onto the wealthy, while making spending cuts that don’t even come close to covering the rate at which spending is accelerating and refusing to address systemic structural problems, can only last for so long.

Blowback

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By 2024, the end of its ten-year forecasting period, a surge of Medicare, Medicaid and Social Security spending will push federal debt held by the public to nearly 80 percent of GDP — “eventually increasing the risk of a fiscal crisis” in which investors would demand higher interest payments to buy federal debt, the CBO report said.

If only there was some serious discussion about not raising the debt ceiling and forcing cuts to the size of government! But sadly, the GOP establishment want to play games and bargain raising the ceiling in return for Keystone XL, amnesty, or something.

The 2008 National Annenberg Election Survey found that 62 percent of immigrants prefer a single, government-run health-care system.

The 2010 Cooperative Congressional Election Study found that 69 percent of immigrants support Obamacare.

Pew also found that 53 percent of Hispanics have a negative view of capitalism, the highest of any group surveyed. This is even higher than the 47 percent among self-identified supporters of Occupy Wall Street.

The Pew Research Center has also found that 75 percent of Hispanics prefer a “bigger government providing more services,” and only 19 percent prefer a smaller government.

Pew also reported that 55 percent of Asians prefer “bigger government providing more services,” and only 36 percent prefer a smaller government. So it’s no surprise that in 2012, 71 percent of Hispanics and 73 percent of Asians voted for Obama.

Who cares what any poll says if AMNESTY PASSES.

VIVA, the transformed United States of North America with it’s 60 million lawncare and domestic workers for the Hamptons and Chambe or Commerce crowd.

Good thing we’re fully insulated from future recessions. If one of those things were to hit us in the next decade, we’d really be in trouble.

BKeyser on February 4, 2014 at 12:59 PM

How abouts we finish up recovering from the 2008 recession before we start worrying about another one? Seriously, Obama should have been called to task for saying how great things were in his SOTU speech. Things are not great- the state of the union sucks and gets worse each and every day with a lazy stupid bastard shucking and jiving, Jew-hating political hacks running State and Defense, and a feckless congress more intent on keeping their jobs than doing the work of the American people.

I just saw a report on FoxNews about the “SURGEON GENERAL” candidate this boob has put up.

A physician in his mid-30′s who has no resume other than he’s an Obama “organizer”. It’s debatable whether this doctor has ever had a practice or seen patients in a clinical setting. He’s a pure political organizer and the MD Congressman from Maryland says he has a chance in hell of being approved.

I just saw a report on FoxNews about the “SURGEON GENERAL” candidate this boob has put up.

A physician in his mid-30′s who has no resume other than he’s an Obama “organizer”. It’s debatable whether this doctor has ever had a practice or seen patients in a clinical setting. He’s a pure political organizer and the MD Congressman from Maryland says he has a chance in hell of being approved.

Since bad reading comprehension is Job 1 at Hot Air, here’s what you’ve left out, according to the WSJ: “the jobs figures largely represent Americans who will choose not to work rather than those who will lose their jobs or have their workweeks reduced because of the law.” People who had jobs just so they could get health care no longer have to do that.

Since bad reading comprehension is Job 1 at Hot Air, here’s what you’ve left out, according to the WSJ: “the jobs figures largely represent Americans who will choose not to work rather than those who will lose their jobs or have their workweeks reduced because of the law.” People who had jobs just so they could get health care no longer have to do that.

Constantine on February 4, 2014 at 3:28 PM

OMG, are you serious? Somehow it is a good thing that people now can get insurance and not work for it? Tell me just how will this all get paid for if we all adopt this “good thing?”

Oh and it doesn’t say no one is loosing their job, just that some will willingly give their job up to apparently freeload of the rest of us.

Since bad reading comprehension is Job 1 at Hot Air, here’s what you’ve left out, according to the WSJ: “the jobs figures largely represent Americans who will choose not to work rather than those who will lose their jobs or have their workweeks reduced because of the law.” People who had jobs just so they could get health care no longer have to do that.

Constantine on February 4, 2014 at 3:28 PM

LOL.

So taking millions of productive employees out of the economy and putting them on welfare is suddenly a GOOD thing.

Not only can we read better than you can, we can also do math. Perhaps if you’d ever done anything other than steal choom money from your grandmother like Obama did, you might know something about economics.